Fuel hedging

[WorldTraveler]

DL can support any policies it wants but it doesn't make law.

AA and DL can buy whatever it wants.

AS and WN are about the only large US airlines that have an all US built fleet - but they also don't fly longhaul int'l routes or have multiple fleet types.

in case you forgot, the discussion is about fuel hedging. DL will post fuel hedge losses. So will virtually every other airline that hedges fuel.

DL and UA will offset some of those losses due to fuel hedge losses due to currency hedge gains.

No US carrier hedges more than 1/2 of its expected fuel consumption so all carriers will benefit from fuel price reductions.

given that fuel hedge losses will amount to less than a couple percent of total revenues, differences in revenue generation have as much or more to do with profitability. DL's revenue generation both per seat mile and in growth per ASM currently leads the US industry.

As much as you or others want to believe otherwise, fuel hedge losses or lack thereof are not going to make a significant difference in total profitability for any carrier.

 

[700UW]

Airbus spends 42 percent of its aircraft-related procurement in the U.S. – buying more parts, components, tooling and other material from the United States than any other country. Workers in more than 40 states help build Airbus aircraft, supporting 226,000 high-quality jobs across the U.S. Airbus is the largest export customer for the United States aerospace industry.
 

 

[jcw]

in case you forgot, the discussion is about fuel hedging. DL will post fuel hedge losses. So will virtually every other airline that hedges fuel.

 

 
That's rich from the cheerleader of changing subjects
 
Now back to regularly scheduled programming:
 
Great - glad to see you admit DL will have fuel hedging losses - glad they will benefit from the reduced oil price like AA will - knowing that they have near 50% (your words - no more than 50%) that means nearly half of their fuel purchases will be at a cost disadvantage - however DL will benefit more when prices goes up since AA does not hedge
 
Now that you have stated that fuel hedging is really not material and revenue is more important - we can stop discussing fuel hedges and guess someone should have never started the thread since it's not material
 
Interesting how you switched to revenue 3 sentences after you lectured us on this being about fuel hedging - I guess this was double standard in full swing

 

[WorldTraveler]

I have NEVER denied that DL wouldn't have fuel hedge losses.

What I have said is that you and others love to focus on one item while excluding others - currency losses and revenue declines - that are just as large if not more significant.

It is a double standard to pick out one item to the exclusion of the big picture.

Airbus spends 42 percent of its aircraft-related procurement in the U.S. – buying more parts, components, tooling and other material from the United States than any other country. Workers in more than 40 states help build Airbus aircraft, supporting 226,000 high-quality jobs across the U.S. Airbus is the largest export customer for the United States aerospace industry.

thank you, 700.

aircraft manufacturing is a global business.

Boeing buys components from all over the world, including Japan which is a major supplier.

it is probably why it makes no sense when someone argues that an airline that buys from A vs B is showing preference to Americans or Europeans.

If anything, jet fuel is far more controlled by the US economy than any other activity in aviation because crude oil is priced world-wide in US dollars.

 

[jcw]

Once again you can't follow the topic - it was not buying A vs B - it was preventing B from financing it's sales - huge difference
 
but as usual financial things go right by you

 

[WorldTraveler]

no, the topic is about fuel hedging. It says it right in the link.

again, AA will not have fuel hedge losses that other carriers will have.

but AA will have currency losses that other carriers will not have and AA will likely have revenue weakness in some regions that other carriers do not have.

we'll see when the final financial results are published but I will say that fuel hedges will amount to less of an issue than a whole lot of people want them to be.

and other factors will be more significant than a lot of people want to pretend they are not.

 

[jcw]

Here we go again - you brought up the purchasing again of A v B aircraft on post # 64 - which we know you can't keep up with your spin
 
So it this is about fuel hedging - stop bringing up other topics
 
So now you have brought up currency losses - is that fuel hedging?  Are you changing subjects again - when you lecture others to stay on topic - does that apply to you - or is that a double standard?
 
I'm glad the fuel hedging will not be material for DL - if it's not important then don't discuss it anymore - move on

 

[WorldTraveler]

no, you started the discussion about Boeing and the Exim bank.

And it has been noted that the global aircraft manufacturing business is not restricted to any one country.

And you have also been told that DL's objection is to low interest rate loans to carriers that threaten the jobs of US airline employees.

DL is VERU American in protecting the jobs of its own employees in major policy issues for the airline industry.

 

[jcw]

so which is it - your preaching this is a fuel hedging thread and blasted folks for talking about A vs B
 
so why do you keep talking about A vs B
 
Are you saying you can dish out advice about what should be discussed on a thread however you won't follow your own directions - amazing

 

[WorldTraveler]

the topic is not about A vs. B.

the topic is about fuel hedging.

I said that fuel hedging gains or losses or not will not likely produce any meaningful difference in profitability because there are other factors that are as big or bigger.

I'm not sure why you feel such a need to distort and manipulate what has been said in order to try to keep arguing... but I can assure you that not only will I keep on you but I will make it clear that you are the one that is more interested in meaningless argumentation than conversation.

No one else on this forum has the problem with understanding the discussion and responding accurately to it, even if in debate, as you do.

if you really can't follow what is being said, there truly is help available.

If you can follow what is being said but intentionally manipulate it, there is also help for you.

 

[jcw]

Seriously read your previous posts - you keep bringing A v B and other things
 
This is about fuel hedging - you have switched from fuel hedging to A v B in posts and threw in currency issues as well
 
In case you can't remember re-read posts: 
 
61 - you switched to revenue
64 - you switched to currency and A v B
66 - you switched again to currency
68 - you switched to global manfacturing
 
tough one for you - if you want this to be about fuel hedging stick to it
 
Since fuel hedging is not really that big a deal as you say - it should have no impact on AA's or DL's 4th quarter per your statements - so we can see how fuel expenses look in the 4th quarter

 

[WorldTraveler]

so glad you have spent hours trying to read the last page of this thread but I have said for MONTHS - long before this thread - that fuel hedge gains for AA would be minimized because AA has currency hedge losses and also will have revenue decreases in Latin America because of the stronger dollar.

fuel hedge gains or losses impact total fuel expenses.... so either it is ALL (all cost and revenue items) on the table or none of it is.

do you wanna just wait until the 4th quarter financials come out in January with the bottom line results or you wanna keep nitpicking?

your choice.

I'll stay on your disconnected logic regardless of the choice you make

 

[jcw]

bless your heart - it didn't take hours to read a page of posts - it made the point otherwise you would not have stayed on fuel hedging - it's funny if fuel hedging is so immaterial to performance - makes one scratch their heads as to why you would hedge if its immaterial

 

[WorldTraveler]

again, you seem completely unable to read the entire post and keep it in context.

I didn't say that fuel hedging or losses on them is immaterial.

I did say for the sixteenth time - or more - (just think how much less I could post if you could accurately quote what I say) that the fuel hedging losses along with currency losses and revenue changes will not result in a material difference in total profitability at all carriers.

AA's lack of hedge losses will be offset by currency losses and revenue declines because of their large presence in regions where local currencies have been impacted by currency changes.

OTOH, carriers like DL and WN have given guidance that their revenue growth will offset a large portion of their hedge losses.

 

[jcw]

poor preacher
 
you can't have it both ways - you can cheer when fuel hedging is helpful to the P/L and then when it's going against them it's not material - you are the one arguing opposing points to suit the argument of the post at the moment
 
There are two lines in the income statement that hedging impacts - first gains/losses on the hedging contracts second the fuel expense line - you can't use the double standard - there will be losses on the contracts and cause a higher fuel cost - just like when the hedge works on the upside - you have a gain and lower fuel cost - see they work in tandem - the only time they don't work in tandem is if you pay to break the contract